Thrifty Thinking: Choosing Credit Cards

Last year was full of financial uncertainty. With the start of a new year, should consumers feel confident that it is a good time to apply for a new credit card? The short answer is yes. The editors at CardRatings.com, one of the first websites to offer credit card ratings and reviews more than 20 years ago, today release their outline of the best welcome offers of 2021.

Many card offers are better now than at the same time in 2020. Some issuers created positive changes like extending the time cardholders have to earn a bonus or increasing the welcome bonus. From cash back cards to business cards, the offers for 2021 are shaping up to be more favorable to consumers than last year.

2021 Credit Card Welcome Bonus Offers

• Chase Freedom Unlimited - New cardholders can earn $200 once spending $500 in the first three months of card membership. Last year it offered 1.5% cash back on all purchases, and now it offers this plus 5% cash back on travel purchased through Chase, 3% back at restaurants and at drugstores.
• Capital One Venture Card - New accounts can earn 60,000 miles by spending $3,000 with the card within the first three months of card membership; a bonus worth as much as $600 in travel. Miles can be redeemed to cover travel purchases, and through April 2021 recent streaming service and food delivery purchases.
• Blue Cash Everyday - New cardholders can earn up to $300. Earn $100 by spending $1,000 within six months of opening an account plus 20% on Amazon.com purchases made during the same timeframe, up to $200 back. Cardholders have six months to earn this bonus instead of the avarge three month window.
• Platinum Card from American Express - New cardholders can earn 75,000 rewards points by spending $5,000 with the card within the first six months. The points increased and the timeframe to meet the spend threshold was extended.
• Gold Card from American Express - New accounts can earn 60,000 rewards points by spending $4,000 within the first six months, nearly doubling what it was this time last year and the time to earn it.
• Ink Business Preferred - New cardholders can earn 100,000 points once spending $15,000 in the first three months of membership. The welcome offer increased, but so did the spend threshold, but those points are worth as much as $1,250 in travel.
• Ink Business Cash - New accounts can earn $750 once spending $7,500 in the first three months of card membership. This is a higher spend threshold, but an average spend of $2,500 a month for a business (for three months) may not be a stretch.
• Ink Business Unlimited - New cardholders can earn $750 once spending $7,500 in the first three months of card membership and the card includes 0% intro APR on new purchases for the first 12 months (then 13.24% - 19.24% variable), plus unlimited 1.5% cash back on every purchase.
• Amex Business Platinum - New accounts can earn 85,000 rewards points once spending $15,000 on qualifying purchases within the first three months of card membership, plus 5X points in five select business categories during the same timeframe.

“These types of bonus offers could help cardholders offset some of their expenses, or assist small businesses struggling to make ends meet,” says Jennifer Doss, an editor for CardRatings. “Terms and welcome offers often change, so it’s important to read the fine print and pay close attention to a card’s details when opening a new account. We try to cut to the chase at CardRatings to make these offers easier to understand.”

View the entire overview here Is it a good time to apply for a credit card?

I had a chance to do an interview Jennifer Doss, editor at CardRating, to learn more.

· How were these cards chosen? Some credit cards have the same or similar offers now as they did this time last year. The cards featured in this article are the cards which have the most obvious changes in their welcome offers. A number of these cards are also CardRatings best credit cards of 2021 picks – a compilation based on editor and real cardholder ratings.

· What can people do to make sure they're applying for the right credit card for their situation? It’s easy for new credit card applicants to get drawn in by flashy welcome offers. A good welcome bonus is certainly a nice incentive to apply for a new card, however, it’s important that applicants closely evaluate a card’s other perks first before making any decisions.

The credit card options these days are numerous but that doesn’t mean the process of choosing has to be an overwhelming one. An applicant must first consider their situation and what they expect from their card, then they can use a website like CardRatings.com to help compare offers.

We break things down a simply as possible so that potential applicants only have to ask themselves a few questions like: “What’s my credit score?” (every cardholder should start here as it’ll help determine which cards an applicant is even eligible for); “Do I want to pay an annual fee?” (annual-fee-cards usually offer the best perks but aren’t the best for someone who doesn’t plan to use their card often enough to offset the cost); “Do I plan to carry a balance?” (if yes, the card’s APR is something very important to consider, as are any 0% intro APR offers); and “In what form do I want to earn rewards?” (cash back, miles, points, etc.).

Even if you can only answer one of two of these things, you’re off to a good start. Evaluating your lifestyle, how you think you’ll use your card, and the expectations you have in a card can help set you up for healthy credit card habits.

· Is now a good time to apply for a new card? Now is a great time to apply for a new credit card. Many of the most popular and highest-rated credit cards have excellent welcome offers right now, especially in comparison to last year, and many banks have really upped their game in improving ongoing rewards. Just like in all other areas of life, there was a lot of uncertainty in the credit card realm early in the pandemic. Many banks scaled back on credit card offers, even going as far as removing some cards from the market altogether. Once card issuers figured out how to best serve cardholders though, many offers came back stronger than ever with new and improved rewards that better met pandemic needs. For example, some cards that once only offered rewards on travel purchases shifted gears to also offer rewards or redemption options for things like grocery purchases, streaming services, and takeout and delivery. Credit card offers and terms are always subject to change, but currently, there are some really solid deals on the table. If there’s a card that catches your eye and you think it would be good fit for your spending habits and lifestyle, now is an excellent time to apply.